Peter’s Premarket Perspective | Thursday, April 29, 2021

Peter Reznicek

The Market Profile value areas and ShadowTrader Pivots for /ESM21 and /NQM21 Futures are posted free every morning in the ShadowTrader Swing Trader newsletter.

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  Pre market indications
Opening In/Out Balance out of balance
Overnight Inventory 100% net long
Current Price/Overnight Range in upper third, close to ONH
Shock and Awe yes
Potential for Early Trade yes
Short Term Bias bullish, above daily 20SMA, new o/n ATH
  Key Levels for Today
4207.75 ATH (overnight)
4193.75 RTH High / Top of Balance Area
4166.75 Bottom of Balance Area
4160.00 Top of Single Prints

Ongoing Narrative / Commentary

Reactions to FB and AAPL earnings along with Powell’s reiteration that it’s too early to talk about any sort of taper of QE has futures up strongly and breaking out of a three day balance. Balance rules apply.

First day in awhile that we’ve opened out of range/balance and have some shock and awe on the open. Gap rules apply. Please avail yourself of the tool tip if you are unfamiliar. As the gap is large, keep #2 and #4 firmly in mind.

  Scenarios

  • Potential is there for early trade which is generally counter trend first on any true gap.  Aggressive traders can short the first one minute low or any cross back down through the open should the opening drive be higher.  Target the RTH High for the gap fill.  This is a very advanced style of market play and it’s not easy to pull off as per gap rules #2 and #4.  
  • Any gap and go scenario will be characterized by extremely bullish internals with either a complete failure to fill the gap at all or a partial fill.  Often the best trade is the cross back up through the open after any partial gap fill.
  • Due to recency bias it can be easy to discount the potential for a look above and fail as per balance rules. Should the gap fully fill and acceptance be found back within the balance area, then there is potential for rotation to the opposing end of balance. See the Key Levels above.
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Peter Reznicek

Peter Reznicek is the founder of ShadowTrader.net and writer of Peter's Premarket Perspective, a morning market profile blog to help people plan their trading day and organize their thoughts before the market opens. He can be reached at asktheshadow@shadowtrader.net.

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